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Bezos lays bare his National Enquirer fight

Jeff Bezos last night accused The National Enquirer of “extortion and blackmail” — with a very public account of a conspiracy theory involving the White House, an affair and at least one “below the belt” selfie.

Context: In December, the tabloid published an exposé of Mr. Bezos’s affair with a TV personality, Lauren Sánchez, minutes after the Amazon chief announced that he was separating from his wife. The Enquirer published what it said were text messages between Mr. Bezos and Ms. Sánchez.

The political angle: Speculation ensued that the report had arisen out of the closeness of The Enquirer’s chief, David Pecker, to the White House. Mr. Trump’s former lawyer, Michael Cohen, has admitted asking the publisher to pay $150,000 to a former Playboy model, Karen McDougal, to protect Mr. Trump’s election prospects, after she claimed to have had an affair with Mr. Trump. And Mr. Trump apparently has a distaste for reporting on him by the WaPo, which Mr. Bezos owns.

The alleged blackmail: This week, according to emails published by Mr. Bezos, a lawyer for The Enquirer’s parent company, American Media Inc., proposed withholding compromising photographs. In exchange, the billionaire would publicly deny that The Enquirer’s coverage was politically motivated.

But Mr. Bezos wouldn’t play ball: Instead, he wrote a blog post explaining what The Enquirer is said to have demanded. As the NYT put it, Mr. Bezos “pulled together random strands of the yearlong legal drama involving the president, American Media and the allegedly illegal payments to women.”

Mr. Bezos’s bottom line: “Of course I don’t want personal photos published, but I also won’t participate in their well-known practice of blackmail, political favors, political attacks, and corruption. I prefer to stand up, roll this log over, and see what crawls out.”

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Today’s DealBook Briefing was written by Andrew Ross Sorkin in New York, and Michael J. de la Merced and Jamie Condliffe in London.

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Lampert got approval for his Sears deal. And a scolding.

A federal judge approved Eddie Lampert’s $5.2 billion takeover bid for Sears at a court hearing yesterday, letting the bankrupt retailer’s C.E.O. try to turn the company around. But the judge also urged Mr. Lampert to avoid becoming a “cartoon character.”

More from Michael Corkery of the NYT:

The hearing was also a referendum on Mr. Lampert, the company’s chief executive and largest shareholder who has controlled Sears since 2005.

Many of the company’s creditors accused Mr. Lampert and his hedge fund, ESL Investments, of running Sears into the ground, racking up losses and falling behind competitors, while spinning off the company’s most valuable assets in ways that enriched his hedge fund.

A lawyer for several Sears vendors, referring to the message to Mr. Lampert, said: “The judge was warning that you claim to want to save tens of thousands of jobs, I hope that is what you do and not end up liquidating the company over the next few years.”

Business leaders pressure Trump for a trade deal

We’re now just three weeks from the deadline for an agreement between the U.S. and China. With neither side budging yet, executives are calling for compromise.

The stakes are high. If no deal is reached by March 1, President Trump plans to raise tariffs on $200 billion of Chinese goods to 25 percent, from 10 percent. So far, there has been little sign of a pact, and fears that it won’t arrive grew yesterday when Mr. Trump said he would not meet with President Xi Jinping of China before the deadline.

Business chiefs are warning of the potential fallout. For instance, Stephen Schwarzman of Blackstone “has been phoning Mr. Trump and his senior advisers to warn that the failure to strike a deal will undermine the economy and roil markets,” according to Bob Davis of the WSJ.

And China is being asked to give a little. “Mr. Schwarzman and other business leaders, including former Treasury Secretary Hank Paulson, are urging senior Chinese officials to make enough concessions to U.S. negotiators to allow Mr. Trump to claim a victory,” Mr. Davis adds. “That includes agreeing to a way the U.S. can enforce the deal should China fall short of its commitments.”

Washington might start small. “Mr. Trump’s outside advisers remain convinced the two sides will reach a deal, even if it is a limited pact that involves mainly purchases and pledges China has already made to gradually open the auto, financial services and other markets,” Mr. Davis writes. “The two sides could then agree to negotiate further over tougher issues.”

Will BB&T’s big deal spark more bank mergers?

The lender’s $28 billion acquisition of SunTrust is the biggest in the banking industry since the 2008 financial crisis. The question is whether it will unleash a long-awaited wave of consolidation.

Many have been predicting mergers for a while. Two years ago, Jamie Dimon of JPMorgan Chase said, “There are too many banks.” Last month, Bank of America’s C.E.O., Brian Moynihan, predicted, “There are now 6,000 odd banks, and you’ll find them continuing to consolidate.”

Banding together makes sense. Mergers help smaller lenders gain scale to compete against national rivals and pool expenses to invest in technology. “The world is changing and we have to change,” Kelly King, BB&T’s chairman and C.E.O., told the WSJ about his company’s deal.

It’s a good time to merge. A loosening of regulations in Washington under the Trump administration helped persuade the banks to explore combining. (Not everyone is happy with that: Senator Elizabeth Warren and Representative Maxine Waters, both Democrats, are pushing for close scrutiny of the transaction.)

F.O.M.O. could force others to act. Nobody wants to be left behind if things take off. “When a deal like this is done it makes everybody who is a mid-sized bank sort of sit back and say, ‘Well, what are we going to do?’ ” Bill Harrison, a former C.E.O. of JPMorgan, told the FT.

A fight may be brewing at the top of SoftBank

The company’s Vision Fund is the biggest tech investor in the world, with designs on shaping the future by creating a web of closely linked companies. But two of its top executives have feuded with each other, according to Bloomberg, raising questions about whether SoftBank and its chief, Masayoshi Son, can achieve that goal.

• SoftBank’s C.O.O., Marcelo Claure, was originally tasked with helping the company’s portfolio of investments work more closely. But he fought with Rajiv Misra, the head of the Vision Fund, Bloomberg reports.

• Mr. Misra won an important battle: “The staff Claure has been hiring to improve operations were shifted over to work for Misra at the Vision Fund instead,” according to Bloomberg. Mr. Claure now has reduced responsibilities.

• The two men played down any disagreements in a joint interview. “Our shared passion for our work should not be misread as tension,” Mr. Claure told Bloomberg.

• The squabble creates a headache for their boss. “Masa probably finds this whole thing frustrating,” the analyst Chris Lane told Bloomberg. “He should be able to go and meddle everywhere, but he doesn’t have time for that and wants Marcelo to do it on his behalf. But what he really did was put two peers of equal stature in conflict.”

A Democratic manifesto for saving the planet

A liberal group of Democrats unveiled their “Green New Deal” yesterday, which calls for the U.S. to eliminate additional emissions of carbon by 2030, Lisa Friedman and Glenn Thrush of the NYT write:

• Drafted by Representative Alexandria Ocasio-Cortez and Senator Edward Markey, the measure is meant to be “a grand strategy that combats climate change, creates jobs and offers an affirmative response to the challenge to core party values posed by President Trump.”

• “It includes a 10-year commitment to convert ‘100 percent of the power demand in the United States’ to ‘clean, renewable and zero-emission energy sources,’ to upgrade ‘all existing buildings’ to meet energy efficiency requirements, and to expand high-speed rail so broadly that most air travel would be rendered obsolete.”

• But “the resolution has more breadth than detail and is so ambitious that Republicans greeted it with derision,” Ms. Friedman and Mr. Thrush add. And its legislative prospects are bleak; Speaker Nancy Pelosi reportedly has no plan to bring the resolution in its current form up for a vote.

Weird ads backfire for a fintech start-up

“To the 12,750 people who ordered a single takeaway on Valentine’s Day: You O.K. hun?” So read an ad for the payment app Revolut that was placed in the London Underground.

But Revolut doesn’t have access to that kind of data. It “is only privy to the merchant and the amount of an individual transaction, and does not have further insight into what its customer’s money is being spent on,” Claer Barrett of the FT writes. A Revolut representative told the newspaper that the numbers used in the ads were “just made up.”

That caught British regulators’ attention. The Advertising Standards Authority says it has passed several complaints on to the Financial Conduct Authority.

Revolut may have lost consumers’ trust. The company was apparently following the lead of Spotify, which has deployed similar marketing tricks. But using fake numbers in a marketing campaign may not inspire confidence in a financial firm.

Revolving door

Airbnb hired Fred Reid, the founding C.E.O. of the airline Virgin America, as its first global head of transportation.

The Danish bank Nordea appointed Torbjorn Magnusson as its new chairman, replacing Bjorn Wahlroos amid pressure from an activist hedge fund.

Bombardier named Danny Di Perna as the new head of its troubled rail unit, the third in three years.

The speed read

Deals

• The food delivery service Postmates filed confidentially for an I.P.O. (Bloomberg)

• Dell is said to be weighing a sale of its publicly traded SecureWorks cybersecurity unit. (Reuters)

• Corporate boards are increasingly open to working with “white squire” investors to stave off challenges by other activist shareholders. (CNBC)

• Amazon and the venture capital firm Sequoia led an investment in Aurora, a driverless-car start-up, at a valuation of over $2 billion. (WSJ)

Politics and policy

• A top priority of Congressional Democrats is limiting corporate gains from the Trump tax cuts. (NYT)

• House Democrats took their first steps toward obtaining President Trump’s tax records. (NYT)

• Mr. Trump said he’s willing to consider revising his unpopular cap on state and local income taxes. But Senator Charles Grassley, the head of the Senate Finance Committee, refuses. (Bloomberg)

• John Dingell Jr., once one of the most powerful Democrats in the House who reshaped countless government regulations, died yesterday. He was 92. (NYT)

Tech

• Instagram banned graphic images of self-harm. (NYT)

• The troubles of Apple and Huawei are particularly troubling for electronics supply chains. (FT)

• The U.S. may retaliate against countries that use Huawei technology in critical infrastructure. (Bloomberg)

• Some Amazon drivers may suffer similar tip issues as Instacart workers. (L.A. Times)

Brexit

• The E.U. refused requests from Prime Minister Theresa May of Britain to reopen the Brexit deal. But it promised to hold more talks to try to reassure lawmakers in London. (NYT)

• Some British companies fear that a no-deal Brexit could more than double the cost of some goods. (FT)

• U.S. lawmakers warned that Britain must keep a “soft” Irish border if London wants a trade deal with Washington. (FT)

Best of the rest

• David Malpass, President Trump’s pick for president of the World Bank, has described his agenda. (FT)

• Ford will invest $1 billion in its Chicago plants. (CNBC)

• Renault says that Carlos Ghosn may have spent company funds on a wedding party at Versailles. (NYT)

• President Trump’s tax law created jobs. For tax lawyers, at least. (WSJ)

• Prince Mohammed bin Salman of Saudi Arabia reportedly told a top aide in a conversation in 2017 that he would use “a bullet” on Jamal Khashoggi. (NYT)

• Gucci and Adidas apologized and dropped products that were called out for being racist. (NYT)

• How a Wall Street church amassed a $6 billion portfolio. (NYT)

Thanks for reading! We’ll see you next week.

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